Agency Request Budget. Child Support Enforcement Automated System

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1 Child Support Enforcement Automated System Organizational Change Coordinator Positions: 1 FTE: 1.00 Business and Functional Design Manager Positions: 1 FTE: 1.00 Project Executive Positions: 1 FTE: 1.00 Project Manager Positions: 1 FTE: 1.00 Child Support Technology Manager Positions: 1 FTE: Project Analyst -System Project Assistants -System Project Communications Specialist -System Project Analysts -System Project Part Time Personnel Positions: 9 FTE: Business Analysts -Case Manager Positions: 6 FTE: 6.00 Pkg 070 Positions (32) FTE: (23.31) Pkg 241 Positions: 32 FTE: Information Systems Specialist 4 -Information Systems Specialist 6 -Information Systems Specialist 7 -Information Systems Specialist 8 Positions: 12 FTE: Legislatively Approved Budget Positions 32 FTE Agency Request Budget Positions 32 FTE Change to Legislatively Approved Budget Positions 0 FTE 1.37 CSEAS Page 107BF02-O 1

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3 Executive Summary Primary Outcome Area: Healthy, Safe Oregonians Secondary Outcome Area: Excellence in State Government Tertiary Outcome Area: A Thriving Statewide Economy Program Contact: Kate Cooper Richardson, Director / Karen Coleman, Project Executive * * *Chart includes Debt Service CSEAS Page 107BF02-O 3

4 Program Overview This Project s purpose is to develop a new automated system for the Oregon Child Support Program. This federally mandated and certified system must function as a case management system, an accounting and distribution system, and a data exchange system that interfaces with multiple agencies within Oregon and across the United States. The process is complicated and must proceed through a number of federally mandated steps. Before obtaining approval for federal funding for a system replacement, the federal Office of Child Support Enforcement (OCSE) required the state to conduct a Feasibility Study to demonstrate the need for a new system, provide an objective analysis of which replacement system best meets the state s needs, and demonstrate the economic payoff of a new system. Program Funding Request Other Funds Limited $ 15,004,692 $ 6,639,116 $ 0 Federal Funds $ 29,091,340 $ 13,369,391 $ 0 Total Funds $ 44,096,032 $ 20,008,507 $ 0 Program Description The Oregon Child Support Program exists to ensure that the children of Oregon receive the support they need to rise out of or avoid poverty, that reliance on public assistance is diminished, and that Oregon s families and future citizens thrive. The Child Support System Project is the effort to build the core essential tool for the Program to fulfill its mission, which is to enhance the well-being of children by providing child support services to families. Program Justification and Link to Long Term Outcomes The Project is a serious and major investment for the state. Confidence in moving forward lies in the level of due diligence and development that the federal government requires, the close side-by-side partnership that Oregon has fostered with its federal oversight CSEAS Page 107BF02-O 4

5 agency at each step of the process, and the major funding commitment by the federal government at the conclusion of the due diligence process. The risks of delay were obvious with Oregon s increasingly brittle system, but delay also would have brought increased capital costs, staleness of the feasibility study, and declining availability of experienced vendors as other states move forward with similar child support system modernization projects. The Child Support Program s mission aligns the Division of Child Support with the Healthy, Safe Oregonians and A Seamless System of Education outcome areas. The Division s work also reaches the Excellence in State Government and A Thriving Statewide Economy outcome areas. The Program s work supported by the new system is foundational to the safety, health, and well-being of children and families. For example: Healthy, Safe Oregonians Ensure there is a Route to Independence for Oregonians Receiving Foster Care and Housing Services. While receipt of child support and provision of medical support or coverage may not be a complete answer to a family s needs, they do contribute to successful outcomes and move families toward self-sufficiency and an improved quality of life. The new system will assist the Program in collecting more child support for Oregonians and decreasing families reliance on public assistance. The Program has no means test and can provide services for a family from cradle to college graduation. Ensure a Safe Environment for Children that Receive Services. Support for Oregon s children is foundational to their safety, health, education, and well-being. When issues of violence exist, the Program has processes in place to help protect parents and children from potential harm while continuing to provide child support services. A Seamless System of Education Establish Affordable Access to Higher Education The Program can continue to provide services until a child reaches emancipation or is no longer in school. Children of least age 18 and under 21 and attending school can receive child support payments from their parent(s). Receiving support during this time allows adult children to focus on their continuing education by reducing their need to join the workforce or reduce their classload to cope with financial demands. Because participating children are required to make academic progress based on their school standards, students are encouraged to perform so they continue receiving support payments. CSEAS Page 107BF02-O 5

6 Excellence in State Government Continued Improvement of Performance Management The outcomes achieved by the Program demonstrate excellence in state government by leveraging General Fund dollars to bring in more than two times the amount in federal dollars. To receive these federal funds, the Program must conform to set standards. The federal government measures, monitors, and audits the Program s performance. In addition to the matched dollars, the federal government provides performance-based incentive funding each year to the Program. Federally matched funds and incentive dollars allow the Program to provide high-quality services with minimal financial impact to the state budget. Implementation of a new child support system will allow the Program to automate basic case functions and redirect worker efforts to the more difficult aspects of case management. The business intelligence component of the new system will provide the Program with the tools necessary for data-driven analysis and process improvement tools currently unavailable in the legacy system. A Thriving Statewide Economy Create Conditions for Business to Grow The Program s relationship with employers is crucial to continued success, and the Program works to minimize the statutory burden on employers as much as possible. By working with the Child Support Program, and its dedicated Employer Services Team, Oregon employers need only work with a single government entity, a single set of forms, and a single group of people exclusively assigned to support them. Additionally, Oregon s Program has received federal recognition for its online Employer Portal that rolled out in 2013 and further enhanced, automated, and simplified the interactions between employers and the Program. Through process improvements, the Program continues to reduce the administrative and compliance burden that Oregon s small businesses face, and encourages them to grow. The new system includes improvements and enhancements to the Employer Portal that will enhance services and increase the ease of use. Growing Middle Class Self-sufficiency helps families attain equitable standing in their communities and diminishes reliance on public assistance. The overwhelming societal problem of child poverty can be addressed significantly by the administration of an effective and fiscally responsible child support program nationally, the child support program is recognized as the fourth-most effective anti-poverty program. The Oregon Child Support Program s efforts with its federal partner to build a modern case management and accounting system move Oregon in this direction. CSEAS Page 107BF02-O 6

7 Program Performance There is currently no effective way to measure performance as the system is still under construction. The new system will increase overall performance of the Program. System replacement goals are: Increase in support collections for families Increase in recoveries for state agencies Remove increasing risk of CSEAS system catastrophic failure Compliance with federal and state regulations and data security requirements Data warehousing and business intelligence Timely completion of legal actions Reduction in manual processes Public cost savings Performance data for the new system will not be available until the Project is complete and the Division has migrated to the new system. Enabling Legislation/Program Authorization Title IV-D of the Social Security Act (42 USC 651 et seq) and ORS provide authority to the Department of Justice to administer child support services in Oregon. Federally mandated requirements for operating and maintaining a child support program system are in a State Plan required by 45 CFR 302. ORS Chapters 286A.820 through 286A.826 provides the authority and guidance for the use of XI-Q bond funds for this Project. Funding Streams The Project is largely funded by leveraged federal funds, with Other Funds providing the balance. The federal government matches each expended state-funded dollar with two federal dollars. The Other Funds for the Project consist mainly of article XI-Q bonds, as well as a small amount of program income diverted from the Program s operating budget for the state portion of non-bondable Project expenditures. CSEAS Page 107BF02-O 7

8 Significant Proposed Program Changes from There have been no significant changes to the Project from The Current Service Level (CSL) funding proposal maintains Project personnel, and the Policy Option Package funds the Project contractors, to reflect the current Project schedule. The increase in FTE is due mostly to the phase-in of positions from The Future is Here Program Project Narrative The Oregon Child Support Program has gone as far as it can with current system technology; the Child Support Enforcement Automated System (CSEAS) is teetering on the edge of collapse. CSEAS is an antiquated, brittle mainframe computer system that is the second oldest in the country, designed in the early 1980s and based on COBOL programming. Although it has been modified over the years to keep current with federal system certification requirements and state mandates to the extent possible, it retains much of its original functional and technical design. The changes made to CSEAS over the years have resulted in a patchwork of code modules that make it difficult to maintain and to keep current with changes to requirements, new mandates, and evolving best practices. Program staff use the aged system and more recent peripheral applications daily to manage their ever-increasing workload. The diagram available in this narrative displays myriad interface and data exchanges the system must maintain on a daily basis. System failure would be tantamount to shutting down the entire Child Support Program and would be catastrophic to Oregon families who depend on child support payments. The age of the underlying technology for CSEAS puts the system at a compounding risk of failure. System failure would result in the Program s inability to comply with the federally-mandated State Plan, loss of eligibility for the federal financial participation and incentive funds, and expose the state to financial penalties. Governments face increasing expectations of efficiency, effectiveness, and quality in operations from those they serve. Due to the age of Oregon s CSEAS, the Program has been forced to forego initiatives that would have improved its capacity to provide services to meet these expectations. As a result, the Oregon Program s composite score of its five performance measures has been in decline to the point where it is now near the bottom third of all child support programs. Oregon needs a more robust and functional system to CSEAS Page 107BF02-O 8

9 serve the families (most in financially vulnerable situations) who rely on the establishment of support obligations, the provision of health insurance, and receipt of regular child support payments. During the biennium, the legislature demonstrated its understanding of this critical problem by approving the initial phase of the Child Support System Project. The legislature understood that, due to the complexity of the child support regulations, statutes, policies, and the size of the caseload, automation is essential to ensure due process in legal proceedings and enforcement actions, to process high volumes of case actions, and to maintain accurate financial records. The legislature continued its commitment to the project by approving funding for development and implementation in the biennium. The new system will allow the Program to keep up with increasing caseload demands in an economic climate where significantly increasing staff size is not a favorable or realistic alternative. CSEAS Page 107BF02-O 9

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11 The Feasibility Study Laid the Groundwork The Feasibility Study documented the federally prescribed process that the Program undertook to define functional and technical requirements for the new system and to select the best system replacement alternative objectively. The needs assessment and gap analysis concluded that the Child Support Program must proactively prepare now to replace its system in order to mitigate the risks of failure and to deliver services more efficiently, more effectively, and with higher quality. Using the results from the needs assessment and gap analysis, the Program defined a set of functional and technical requirements for a replacement system. In turn, these requirements became the foundation for the Program s objective evaluation to select the best solution from among four system replacement alternatives. The alternatives evaluated were: 1. Build from scratch 2. Modernize CSEAS 3. Transfer alternative (adapt a system from another state) 4. Hybrid (combine best of breed features from multiple systems) The evaluation process judged each alternative against criteria that considered system implementation risks, the total cost of the alternative, the total benefits generated from the alternative, and the length of time from project start until implementation. Based on the results of an objective evaluation of four system replacement alternatives, the Child Support Program determined that the best solution to replace CSEAS was to develop a system that combines the best features from the newest child support systems in other states. This hybrid solution is based on transferring base system functional and technical components from three states systems (California, Michigan, and New Jersey). The Child Support System Project will result in an application that: Provides a technology platform based on modern design principles that will facilitate future maintenance and enhancements. Reduces the significant risks and costs of aging technology. Supports the Child Support Program s initiatives to improve its efficiency, effectiveness, and quality. Enables the Program to use business intelligence queries to provide Program managers and staff with statistics, reports, and information to better serve Oregon families. Leverages proven technologies from other states, reducing implementation time. Lowers the ongoing maintenance costs of technology. Reduces the time needed to become proficient as a child support case manager, increasing staff retention. The System Project anticipates a 34-month design and development period, a 9-month transition period for regional rollouts of the system, and a 22-month maintenance transition period. The project is scheduled to conclude in CSEAS Page BF02-O

12 Data Reliability and Reports The Program must rely on the data extracted from the Child Support System to prepare federally mandated reports, pass data reliability audits, maintain a federally certified system, and continue to receive the maximum amount of federal incentives. The Oregon Secretary of State Audits Division provided the Program with guidance on what would help elevate Oregon s position when compared to other child support programs. One such observation was pertaining to the lack of business intelligence tools. Business intelligence tools provide the ability to view, evaluate, analyze, and diagnose a variety of child support case attributes. The ability to do so provides staff with concrete information on which to base decisions and child support actions. Business intelligence also provides those same staff or managers with the ability to monitor the results of their decisions and actions. Business intelligence tools allow for real time reports so that actions can be immediate. The audit concluded that increased collections would be the result of such an investment. The Child Support System Project will result in a new system that will bring increased data reliability and business intelligence tools that will allow the Program access to data analytics to help improve its performance and collect more support for families. Business Process Reengineering Due to the age and architecture of CSEAS, the Program invented multiple work-arounds to perform basic child support functions, and to make the necessary system updates from changes in state and federal regulations. Many of the Program s current work flow processes are built around the system s limitations and are cumbersome and labor-intensive. With the support of the 2012 legislature, which appropriated funds toward this effort and which the federal government double-matched, the Program conducted a Business Process Reengineering that guided the Program through the examination of all the current work flow processes. This effort resulted in a redesign for integration into both current processes and the Child Support System Project that is logical, reduces unnecessary steps or rework, creates greater efficiencies, and reduces the amount of staff intervention currently required to complete the necessary tasks. The implementation plan for the new child support system has incorporated the new work flow processes in the system s requirements and design. The Program recognized that it would be irresponsible to invest in a feasibility study to determine the most cost effective way to complete the Child Support System Project, but then build a system that supports work-arounds and inefficient work flow processes. CSEAS Page BF02-O

13 Child Support Enforcement Automated System 010 Non-PICS Psnl Svc / Vacancy Factor Purpose: This package includes the following adjustments: Standard Inflation factor of 3.7%, adjustment for the vacancy factor and mass transit taxes, and PERS bond assessment (PBA). How Achieved: Accounts were adjusted using the DAS published instructions / Staffing Impact: None Revenue Source: $60,391 Other Funds Limited $113,730 Federal Funds $174,121 Total Funds 022 Phase-Outs Purpose: This package phases out all variable costs associated with the Child Support Automated System Project. These are the costs incurred by the Project s four major contractors, as well as any other one time project costs. How Achieved: Abolished expenditures / Staffing Impact: None Revenue Source: ($16,793,292) Other Funds Limited ($27,290,603) Federal Funds ($44,083,895) Total Funds CSEAS Page BF02-O

14 Child Support Enforcement Automated System 031 Standard Inflation and State Government Service Charge Purpose: Standard inflation of 3.7% was applied to all services and supplies accounts except for Rent, Professional Services, Attorney General, and State Government Services Charges. The package adjusts the State Government Service Charges assessed by DAS, Secretary of State Audits Division, State Library, Supreme Court Library, Risk Management, and others based on the State of Oregon Price List of Goods and Services. Inflation of 6.9% was applied to Rent (uniform and non-uniform), 4.1% to Professional Services, and 13.14% to Attorney General line items. How Achieved: Accounts were adjusted using the DAS published instructions / Staffing Impact: None Revenue Source: $58,446 Other Funds Limited $92,282 Federal Funds $150,728 Total Funds 060 Technical Adjustments Purpose: This package includes Price List adjustments not in line with the 3.7% increase, i.e. DAS State Data Center (SDC), Price List (usage based) allocation adjustments between divisions to better match expenditure patterns, and rent adjustments between divisions due to projected rent and DAS lease fees that are above 6.9% in the biennium. How Achieved: Accounts were adjusted using the DAS published instructions / Staffing Impact: None Revenue Source: $14,835 Other Funds Limited $28,794 Federal Funds $43,629 Total Funds CSEAS Page BF02-O

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19 Child Support Enforcement Automated System 070 Revenue Reduction Purpose: There is a lack of funding at the current service level (CSL) for Project activities and positions. This package is to reduce all related expenditures from the CSL budget. The Child Support System Project Bond funding request, all associated expenditure limitation, and Position/FTE requirements are included in Policy Option Package 241 for the biennium. How Achieved: The Division will reduce 32 positions / FTE Staffing Impact: (32) Positions / (23.31) FTE Staffing Impact: (32) Positions / (23.31) FTE Quantifying Results: The lack of any Project positions to support the IT System Project will create a serious risk to the Project, including slippage to the project schedule. Project schedule slippage will require vendor contract extensions, increasing overall costs significantly. The Program will be forced to use Operations positions in the Project to mitigate the slippage at the risk of Program performance and incentive funding. The Department of Justice Information Services section would have to bill their time through the agency s indirect rate. Because of the size and length of the System Project, and the way the indirect rate is applied, this may adversely impact other divisions within the Department and will increase costs for the Division of Child Support for a minimum of two years after the Project ends, distorting the true cost. Revenue Source: ($2,032,524) Other Funds Limited ($3,910,610) Federal Funds ($5,943,134) Total Funds CSEAS Page BF02-O

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25 Child Support Enforcement Automated System 241 Child Support System Project Purpose: Provides continued funding necessary for the replacement of the state child support system. In the and Legislatively Approved Budgets, the Department of Justice (DOJ) Division of Child Support (known as the Oregon Child Support Program, with inclusion of 25 participating District Attorney offices) received funding for the state s portion of the cost to replace the state child support system. Due to the scope of the Project, the funding and the Project extend over several biennia. Work started in one biennium extends into the next biennium. Since the 2015 Legislative Session, project team members have worked in partnership with DAS Procurement Services and DOJ procurement attorneys to complete four separate procurements (contractors for Project Management, Quality Assurance, Independent Verification & Validation, and Implementation or System Integrator) to hire the necessary expertise to ensure DOJ meets the project objectives successfully. The project facility was set up with the onboarding of the Implementation Contractor, followed by the baselined schedule and budget. Additionally, Project team members worked with the Office of the State Chief Information Officer (OSCIO) and the Legislative Fiscal Office (LFO) to receive Stage Gate 3 endorsement in January 2016 and Readiness Assessment approval in July The project continues to move forward with system design, development, and testing. The operational system will begin the phased rollout in 2018 and anticipates implementation statewide in early How Achieved: The Department of Justice will develop a child support system that meets the requirements of Title IV-D of the Social Security Act (42 USC 651 et seq) and enables the Oregon Child Support Program to deliver child support services in Oregon. The System Project anticipates a 34-month design and development period, a nine-month transition period for regional rollouts of the system, and a 22-month maintenance transition period. The project is scheduled to conclude in 2021.This package also includes restoring permanent positions reduced from revenue reduction package 070 due to the revenue to support the positions being included in this package and not the modified current service level budget, as well as increasing the Project Fiscal Officer to a full FTE Staffing Impact: 32 Positions / FTE Staffing Impact: 32 Positions / FTE CSEAS Page BF02-O

26 Child Support Enforcement Automated System 241 Child Support System Project Quantifying Results: The measure of success for this request is the successful completion of the Child Support System Project and the receipt of federal systems certification in accordance with the federal requirements. Federally mandated requirements for operating and maintaining a child support program are in a State Plan required by 45 CFR 302. ORS Chapters 25 and 416 set out the processes for obtaining child support services, establishing and enforcing support orders, and the distribution of money. ORS provides authority for promulgating administrative rules for child support guidelines (OAR et seq), establishing a support obligation, and rules for operation (OAR et seq). Restoration of Package 070 personnel and increasing the Fiscal Officer FTE will allow the Program to continue to participate in project activities as well as meet the reporting needs of the Department of Justice, the Department of Administrative Services, and the Legislative Fiscal Office. It will also mitigate the risk of project schedule slippage, which can increase overall project costs significantly because of vendor contract extensions. The positions will allow the Program to maintain operations personnel at current levels, providing the support needed to maintain performance levels. Revenue Source: $15,004,692 Other Funds Limited $29,091,340 Federal Funds $44,096,032 Total Funds CSEAS Page BF02-O

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32 DETAIL OF LOTTERY FUNDS, OTHER FUNDS, AND FEDERAL FUNDS REVENUE ORBITS Source Legislatively Approved Estimated Agency Request Governor's Budget Legislatively Adopted Fund Revenue Acct Actual $ 15,209,670 $ 18,296,430 $ 18,296,430 $ 13,918,720 $ - $ - Child Support - Federal Funds Ltd 6400 Misc.Transfers In/(Out) - Other 3400 Funds Ltd 0995 $ 29,997,991 $ 29,997,991 $ 29,997,991 $ 29,091,340 $ - $ - - $ $ - Child Support - Other Funds Ltd Total Other Funds Ltd 3400 Total Federal Funds Ltd 6400 $ $ $ 51,798 15,209,670 $ 18,296,430 $ 18,296,430 $ 13,970,518 $ 29,997,991 $ 29,997,991 $ 29,997,991 $ 29,091,340 $ CSEAS Page BF07

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